Loans are undergoing a lot of changes and are becoming more innovative to suit the different requirements of individuals and businesses. Even when it comes to businessloans, there are a lot of loan options to select from. One such option is flexi business loans. Do you know what flexi business loans are?
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Flexi business loans
Flexi business loans are flexible loans which are allowed to businesses for meeting their business requirements. The loan amount is flexible and the interest is calculated on the amount of loan, which is availed. The repayment tenure is also flexible and short so that the loan is repaid easily and quickly.
How the loan works
Flexi business loans are allowed as a pre-approved loan limit. The lender offers your business a limit of loan, which can be availed. This limit is determined to take into consideration your business’s financial status and your credibility. Your business can, then avail the funds required against the limit approved. Suppose your business gets a flexi loan of INR 20 lakhs. Against this loan if you need INR 7 lakhs for your business needs, you can avail the funds as and when required. After that, you can avail of the remaining funds whenever you require. The interest would be calculated on the amount that you borrow and not the amount which is sanctioned as the loan limit. Thus, in the example mentioned above, if you borrowed INR 7 lakhs, interest would be calculated and charged on INR 7 lakhs.
Who offers flexi business loans?
Banks and non-banking financial companies both offer flexi business loans. There are, therefore, a lot of loan offers to choose from.
Advantages of flexi business loans
Flexi business loans have a lot of benefits which are as follows:
- The loans are easily available. You can easily apply and avail a Flexi business loan. The loan has simpler eligibility parameters and can be availed by almost all types of businesses.
- The loan has multipurpose use. You can use the loan for any type of business need that you have, whether it is repaying your creditors or your workers.
- The interest rate on loan is low, and since the interest is calculated on the amount borrowed and not the amount sanctioned, the outgo is reduced. Businesses, therefore, can save their interest expense and increase their revenues.
- A flexi business loan is available within a short period. Thus, in case of urgent financial requirements, a flexi business loan comes in handy
- The loan amount depends on your credit score. If you have a good credit score, you can avail a considerable amount of funds for your use. The lender does limited scrutiny before offering the loan limit making it easier to access funds.
- You can withdraw the loan as per your requirement. There is no condition on the time or number of withdrawals that you can make. As long as the loan amount is within the approved credit limit, you can avail funds any number of times.
- Prepayment is also available under flexi business loans. Whenever your business has surplus funds, you can prepay a part of the loan availed and reduce your liability.
Thus, Flexi business loans are a good solution for business financing and can be availed easily.
